The CFO gender gap: part two

The CFO gender gap: part two

How can organisations overcome the gender gap issue? CFO World speaks to top finance women about the importance of having female role models and career development programs

The issue of men outweighing women in top finance roles and in pay continues to loom over the profession. So what can organisations do to help change that and ensure their executive teams are more gender balanced?

“Some businesses aren’t authentic in their pursuit of diversity. They hire a woman to fulfil a c-level position thinking that will tick the ‘diversity box’,” says Jenny Macdonald, CFO of REA Group.

While unpopular, Coca Cola Amatil CFO, Nessa O’Sullivan, suggested it may be time to call for quotas. “Given how little progress has been made, quotas may be needed to engage companies and boards in developing female talent and to working on removing career barriers at every level in their organisations,” she claims.

O’Sullivan has been fortunate enough in her career to have come across a range of senior leaders both female and male who have been generous in giving their advice and encouragement. However there have also been examples of those who unfortunately make it more challenging than it needs it be for females to succeed.

One of the barriers women face in progressing through their careers and making it to top finance positions is the bias existing around leadership capabilities between men and women, O’Sullivan says. Because not many women are making it to the top spot, people are unused to seeing women in traditionally male dominated roles and this can inadvertently lead to a lack of acceptance of women in high-level leadership roles.

“To accelerate the change it would be a very positive step if more organisations actively addressed biases in their organisations. There is every reason why this should be more of an organisational priority for businesses in Australia - not only would it improve the outcomes for women, it would also improve outcomes for their businesses and their shareholders,” she explained.

It’s not just about getting the numbers right at the senior level that will remove the barriers women face during career development, nor is it only about getting the intakes at the junior level balanced, O’Sullivan says. It’s also about putting in place career development programs to help grow female talent and encourage women to take on bigger roles.

“It requires an organisation to focus on how well they are doing growing female talent and getting the development programs and work experience in place for females in their organisations… and it does require holding senior management accountable for outcomes,” she says.

Change needs to come from the top

“For real change in the environment and culture of a workplace, there has to be a genuine desire and focus from the CEO and board to make a change,” says Macdonald.

Fiona Robertson, non-executive director of Drillsearch, has spent 20 years in the CFO role at various resources companies. She says one of the biggest deterrents to changing a gender imbalance is organisations not allowing staff to have open discussions about diversity challenges they may face, or not addressing the issues directly.

“It’s up to the senior ranks of organisations to provide channels for those discussions to take place, to legitimise them because they are difficult discussions,” she says. “People will often be very reluctant to have open discussions around those sorts of issues because they are concerned about what the implications may be [to their brand or reputation].

“You have to get male engagement to legitimise females and diversity in an organisation. Men will pay lip service to, ‘Yes, we would like to see more women’. But the reality is I don’t know if they necessarily understand the issues, necessarily engage with those issues.”

The importance of role models

With so few women at senior levels, those that do succeed and are progressing can find the career path a somewhat lonely place. O’Sullivan said networking with other senior women is a great way of finding support, making it all a bit less of a solo flight.

Robertson knows many women in the early to middle stages of their careers who say a lack of successful female role models is a disincentive to taking on more challenging roles. “If we don’t help each other then we are never going to see the numbers of women at senior levels change.

“I think what organisations need to do is find ways to involve senior successful role models in their internal interactions. For example, to get successful women to come and address training programs that involve both men and women so that middle ranks are seeing examples or role models of successful female leaders in their own organisations. Another way of doing it would be to consciously engage female teams of external consultants.”

O’Sullivan agrees having female role models can make all the difference from changing the perception of top leadership roles being male orientated to having access to mentors who can help guide others’ in their careers.

The benefits of diversity

Another way of improving the ratio is by pointing out the benefits of diverse executive teams. According to a 2012 research report from Credit Suisse, net income growth for companies with women on their boards averaged 14 per cent over the past six years, compared to 10 per cent for those with no female board members.

The survey also found stocks from companies with women board members and a market capitalisation greater than US$10 billion outperformed those without women board members by 26 per cent over the past six years.

“The industry is missing out on some great leaders as a result of the lack of female representation at senior levels,” says O’Sullivan. “Sadly, the representation of females gets even worse as you go to the top 100 and the top 50. With the CFO role as a proven path to CEO and board roles, this will have a knock-on effect of less of a talent pool to feed CEO and board roles into the future.”

Robertson agrees, adding a lack of diversity not only results in less talented leadership for an organisation to tap into but also a lack of diverse thinking, which can negatively impact on an organisation’s ability to be innovative and compete.

While there are more finance women coming through middle management roles and making it onto company boards, there’s still a long way to go.

“I was a CFO back in the 1990s and I don’t believe there are appreciatively more women in senior management positions than there were then,” Robertson says.

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Tags finance careersCFO womenFiona Robertsongender biasfinance industryfinance leadersCFO Nessa O’SullivanCFO Jenny Macdonald

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